Coal price formula for mine mouth power plant completed

The Ministry of Energy and Mineral Resources has completed the revision of coal price formula for mine mouth power plant which is expected to trigger price competition among miners in supplying coal for mine mouth power plant projects, Bisnis Indonesia reported.

This was said by Director General of Mineral and Coal at the ministry Bambang Gatot Ariyono, but stopped short of providing details.

Previously, coal price for mine mouth power plant projects is determined based on a formula of production cost plus a 25 percent margin.

Ministry officials were previously quoted as saying that under the planned new formula, coal miners will be free in determining the level of margin as long as it does not exceed the 25 percent limit, which would allow better competition among the miners in supplying coal for mine mouth power plant projects. This will hopefully help reinvigorate domestic coal market. (*)